v3.26.1
Income Taxes
 12 Months Ended
Apr. 30, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
In the period ended April 30, 2026, the Company became a tax resident in the United States. As such, the categories in connection with certain disclosure requirements have changed and are therefore reflected separately from prior years.
The components of income before provision (benefit) for income taxes for the period ended April 30, 2026, is as follows:
Year Ended April 30,
(In millions)2026
United States
$
1,769 
Foreign
32 
Total pre-tax income $1,801 
The components of income before provision (benefit) for income taxes for the periods ended April 30, 2025, and April 30, 2024, were as follows:
Year Ended April 30,
(In millions)20252024
United Kingdom
$
(5)
$
(31)
Foreign
United States
2,018 
2,106 
Other
57 
19 
Total pre-tax income $2,070 $2,094 
The components of the provision (benefit) for income taxes for the period ended April 30, 2026, is as follows:
Year Ended April 30,
(In millions)2026
Current
U.S. - Federal$279 
U.S. - State and local75 
Foreign29 
Total current$383 
 
Deferred
U.S. - Federal$84 
U.S. - State and local15 
Foreign(6)
Total deferred93 
Total provision (benefit) for income taxes$476 
The components of the provision (benefit) for income taxes for the periods ended April 30, 2025, and April 30, 2024, were as follows:
Year Ended April 30,
(In millions)20252024
Current
United Kingdom$(6)$2 
Foreign
U.S. - Federal410 195 
U.S. - State and local69 80 
Other2 9 
Total current$475 $286 
 
Deferred
United Kingdom$12 $(7)
Foreign
U.S. - Federal1 232 
U.S. - State and local16 14 
Other13 (3)
Total deferred42 236 
Total provision (benefit) for income taxes $517 $522 
For the period ended April 30, 2026, the Company was a tax resident in the U.S. Therefore, the Company utilized the U.S. statutory rate within the following reconciliation of the provision (benefit) for income taxes.
Year Ended April 30,
(In millions)2026
Computed tax at statutory rate$378 21 %
State and local income taxes, net of federal benefit75 4 %
Foreign tax effects16 1 %
Tax credits(1)— %
Nondeductible or nontaxable items10 — %
Changes in unrecognized tax benefits(2)— %
Effective tax rate$476 26 %
State and local taxes in Florida, California, New York, Virginia, Illinois, Georgia, and Tennessee make up the majority (greater than 50%) of the tax effect in the state and local tax category.
For the periods ended April 30, 2025, and April 30, 2024, the Company was a tax resident in the U.K. Therefore, the Company utilized the U.K. statutory rate within the following reconciliation of the provision (benefit) income taxes:
Year Ended April 30,
(In millions)20252024
Computed tax at statutory rate$517 25 %$523 25 %
Foreign tax effects
United States
Statutory tax rate difference(81)(4)%(84)(4)%
State and local tax70 3 %77 4 %
Other4 — %1 — %
Other foreign jurisdictions1 — %2 — %
Nondeductible or nontaxable items6 1 %3 — %
Effective tax rate$517 25 %$522 25 %
There are no effects of changes in tax law or rates enacted in the periods, effects of cross-border tax laws, tax credits, changes in valuation allowances or changes in unrecognized tax benefits which are material for separate disclosure.
Income tax paid (refunded) for the period ended April 30, 2026, is as follows:
Year Ended April 30,
(In millions)2026
U.S. - Federal$233 
U.S. - State and local (1)
73 
Foreign
Canada30 
Other(4)
Total income taxes paid$332 
(1)Income taxes paid to state jurisdictions are individually immaterial.
Income tax paid (refunded) in periods ended April 30, 2025, and April 30, 2024, were as follows:
Year Ended April 30,
(In millions)20252024
United Kingdom$(41)$1 
Foreign
U.S. - Federal397 149 
U.S.- State and local63 89 
Other6 7 
Total income taxes paid$425 $246 
The components of deferred income tax assets (liabilities) are as follows:
April 30,
(In millions)20262025
Deferred tax assets:
Lease liabilities $738 $696 
Accruals and reserves196 172 
Net operating loss and credit carryforwards29 28 
Capital loss carryforwards15 15 
Interest carryforwards— 1 
Other deferred tax assets5 — 
Gross deferred tax assets983 912 
Valuation allowances(24)(18)
Total net deferred tax assets959 894 
Deferred tax liabilities:
Property and equipment(2,502)(2,400)
Right of use assets(680)(644)
Intangibles(152)(131)
Other deferred tax liabilities(19)(7)
Gross deferred tax liabilities(3,353)(3,182)
Net deferred tax liabilities$(2,394)$(2,288)
As of April 30, 2026, the Company has gross net operating loss carryforwards (“NOLs”) of $9 million related to U.S. federal jurisdictions that may be carried forward indefinitely. In addition, the Company had $297 million of gross NOL carryforwards related to U.S. state jurisdictions that may be carried forwarded indefinitely, as well as $128 million of gross NOL carryforwards related to U.S. state jurisdictions that will expire between 2038 and 2041. The Company also had $32 million of gross NOL carryforwards related to the U.K. jurisdictions that may be carried forward indefinitely.
A valuation allowance has been provided where it is more likely than not that the deferred tax assets related to those operating loss carryforwards or gross temporary differences will not be realized. The following table presents the changes in the carrying amount of the valuation allowance for each of the three years in the period ended April 30, 2026:
Year Ended April 30,
(In millions)202620252024
Balance at beginning of year$18 $13 $27 
Increase (decrease) in valuation allowance$6 $4 $(14)
Foreign exchange— 1 — 
Balance at end of year$24 $18 $13 
We file income tax returns in the United States, Canada, and the United Kingdom and are subject to audits until the respective statutes of limitation expire. The tax years that remain subject to examination as of April 30, 2026, are 2023-2025 for the United States, 2025 for the United Kingdom and 2022-2024 for Canada. The Company has ongoing U.S.
state and local audits for tax years 2018-2025; however, we do not expect any material assessment to arise from these audits.
The following table provides a reconciliation of the total amounts of unrecognized tax benefits, which may impact effective tax rate if recognized:
Year Ended April 30,
(In millions)202620252024
Balance at beginning of year$5 $5 $5 
Gross increases related to prior period positions— — — 
Gross decreases related to prior period positions— — — 
Gross decreases related to expiration of statute of limitations(2)— — 
Foreign exchange— — — 
Balance at end of year$3 $5 $5 
The Company recognizes benefits from tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the positions. The tax benefits recognized in the consolidated financial statements from such positions are measured as the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement.
The Company recognizes interest and penalties in the income tax provision in the consolidated statements of income. As part of the unrecognized tax benefits balance for the years ended April 30, 2026, 2025 and 2024, the Company had accrued interest and penalties of $1 million. For the years ended April 30, 2026, 2025 and 2024, there was no movement reported in income tax expense related to interest and penalties.
The Company considers the undistributed earnings of our foreign subsidiaries to be indefinitely reinvested. If it is determined that all or a portion of such foreign earnings are no longer indefinitely reinvested, the Company may be subject to federal, state, or withholding taxes on these undistributed earnings. As of April 30, 2026, unremitted earnings of foreign subsidiaries were $2,167 million. Determination of the amount of unrecognized deferred tax liability on these unremitted earnings is not practicable.
On July 4, 2025, new tax legislation (the “Act”) was enacted in the United States. The Act, among other things, permanently reinstated 100 percent bonus depreciation, permanently reinstated the EBITDA approach for calculating the business interest limitation, permanently reinstated the immediate expensing of certain U.S. domestic research and experimental expenditures, and made modifications to the international tax framework. The legislation has had no material impact on our effective rate; however, it has decreased our U.S. income tax liability and increased our deferred tax liability. We will continue to evaluate the full impact of the legislation as additional guidance becomes available.
To facilitate the relisting as a U.S. parented group, the Company, along with other intermediary steps, completed a U.K. court-sanctioned scheme and an internal spin-off (the “Reorganization”.) The Reorganization replaced Ashtead Group plc (“Former Parent”) with a new U.S. holdings company, Sunbelt Rentals Holdings, Inc (“Sunbelt”), and distributed the U.S. operating group from Former Parent to Sunbelt. The Company determined that the Reorganization qualifies as tax-free under the applicable sections of the U.S. Federal and U.K. tax law. In making these determinations, management applied relevant tax law to the facts and obtained third party legal and tax opinions related to the concluded tax treatment. If the Reorganization were later determined to fail to qualify for tax-free treatment, the Company could be subject to significant liabilities, and there could be material adverse impacts on the Company’s business, financial condition, results of operations and cash flows in future reporting periods.